10 ways we rely on correlations more than causation

Preview

According to philosopher David Hume, we assume causation when observing closely occurring phenomena. However, it is possible that these phenomena could be coincidental or merely correlated. This can lead to incorrect conclusions and decisions. Despite the potential drawbacks of correlation, it is an essential component of our world, and we depend on it significantly to operate effectively.

1. Mathematical models are based on correlations or relationship between two variables

2. Generative AI is a predictive correlation machine which has proven its practicality and widespread adoption even though it's not perfect

3. Correlations run our financial systems: risk managment, trading, capital assessments, insurance premiums

4. Systems are often too complicated to chase causal reasons for every decision so we lean on correlations

5. It's easier to measure correlations rather than causation

6. Causation is often subject to bias and most people assume single casual for events

7. Correlations spur creativity and exploration

8. Correlations help us narrow down our choices based on our preferences in recommendation systems

9. Correlations point to unfortunate truths that we seem to sweep under the rug

10. We make predictions based on correlations useful for planning and strategy